“Despite the difficulties currently facing our country, we are optimistic about the future.”
Interview: Boris Levitan, OAO Radiofizika CEO
OAO Radiofizika is a Russian radio-electronics company that specializes in radars and telemetry equipment, satellite communication systems, antennas, and electronic components. It also pursues research in the area of electromagnetic compatibility of radio-electronic equipment. Boris Levitan is the company’s director-general (CEO). He is a professor at the Moscow Aviation Institute, and holds a PhD in technical sciences. Below is a Moscow Defense Brief interview with OAO Radiofizika Director-General Boris Levitan.
Q: Could you summarize Radiofizika’s 2014 results for us? What are the company’s key economic indicators?
A: Last year proved very eventful for Radiofizika. The Russian MoD set some very ambitious goals for us. We have become the sole supplier in some segments of the defense market, which means extra responsibility for us. We also met all our R&D targets in 2014. As a result, we have received extra financing for a technology upgrade program. For the first time in many years, we installed new technological equipment last year. Our revenues were up 25 per cent on the previous year. This is due solely to growing productivity since our payroll remains flat. We have also conducted a share issue; the shares were bought by the head company, Almaz-Antey. This has enabled us to recapitalize. Wages at our company have grown substantially, by an average of 10-15 per cent, so our staff’s earnings have kept up with the high inflation last year.
Q: Last year your company’s systems were demonstrated at the DEFEXPO India 2014 exhibition for the first time. What are your impressions of that exhibition? Has it been successful in terms of marketing your company’s products?
A: We believe that our participation in the Indian defense expo was very productive. We held a series of talks with Indian partners. Now, following a series of visits to India by the Russian leadership and senior MoD officials, we hope to sign several agreements.
Q: In what exhibitions and industry events will Radiofizika participate in 2015 and beyond? What are the most promising markets for your products?
A: In 2015 we will demonstrate our systems at the Aero India exhibition and the Moscow Aerospace Show (MAKS). We won’t just bring brochures or mockups; we will demonstrate actual weapons systems that have already been comprehensively tested to prove that they meet all specifications. We believe that India and China are the two most important markets for us. We are now in talks with partners from both countries.
Q: The Indian defense industry has been growing rapidly in recent years. Do you believe that India is still interested in buying finished radar systems, or do they now insist on technology transfer and localized in-country production? Have you discussed joint radar R&D projects with Indian partners?
A: We are considering the possibility of localizing the development and manufacture of some elements and components of our products in India. We are quite interested in such projects, just as the Indians are, because gaining the experience of joint R&D projects with a foreign partner is a new challenge for us. I would like to point out that our willingness to participate in joint R&D projects and to transfer technology is an important competitive advantage. Most of our foreign competitors are not ready to transfer technology; they just want to sell finished products to their customers.
Q: In 2013 you gave the first demonstration of a working Demonstrator unit, the new specialized radar developed by Radiofizika. What is the current state of the Demonstrator program? Do you already have prospective customers?
A: In 2014 the Demonstrator passed a series of live tests at the Russian MoD’s ranges. There will be another series of tests this spring; the system will be expected to perform more complex tasks. Also, thanks to the new equipment we have bought, our company is now ready to begin mass production of parts and components for the Demonstrator. By localizing the production of radar components at our own facilities, we have achieved very good reliability at an acceptable price. Price is very important, because having a price advantage helps a lot in the market for expensive active phased array radars.
Q: What other products, apart from active phased array radars, is Radiofizika ready to offer to foreign customers? Are there any potential customers for your satellite communication systems and antennas?
A: One of the market segments in which we specialize is satellite communication systems for Russian air traffic control. These systems are optimized for work with Russian space technology, but we can also modify them for work with foreign satellites. Several of our stations are already working abroad, including Anchorage in the United States, as well as places in Europe, Mongolia, and China. We are also in talks with Chinese partners on pooling our efforts to develop a new system of space monitoring. Just like us, the Chinese are interested in locating and tracking space debris, especially small debris that can pose a threat to our spacecraft. We expect to sign an agreement with the Chinese in that area in 2015. We are also ready to invite partners from other space-faring nations to join that program. In terms of technology, developing such a system is a major challenge because it requires the deployment of high-frequency bands and large active phased array radars to improve the accuracy of locating, tracking, and measuring the parameters of space objects.
Q: What are your main programs in the domestic Russian market? What is the state of your cooperation with other divisions of the Almaz-Antey Air Defense Concern? Have you discussed the project to develop a space monitoring station? Has that project made any progress?
A: Speaking of projects that are nearing completion, I would like to highlight the project to develop a national system of monitoring compliance with international agreements in the area of space launches. As part of that project (Project Morinos), we are equipping the Marshal Krylov instrumentation and tracking ship with a new Radiofizika-developed system of measuring the parameters of space launches. Also, in 2014 we secured a Russian MoD contract to continue R&D in that area.
Q: One of the key trends for Russian industry in 2014 was import substitution. What has been Radiofizika’s contribution to achieving that goal?
A: Import substitution in a high-tech industry is a complex and labor-intensive process. We have to start with domestic production of super-pure components, pure metals, and pure gases. Thanks to the funding we have received under federal programs from the Russian government, we have been able to upgrade our production facilities. We can now work not only with finished components, such as amplifiers, capacitors, and transistors, but also with semi-finished stock. We can buy such stock at relatively low prices, including semiconductor wafers with the necessary layers already applied, and then use them to manufacture the required electronic elements. This has enabled us to reduce the cost and improve the reliability of finished modules, and, subsequently, of the entire arrays. Our new manufacturing capability is sufficient not only to meet our own requirements, but also to supply other divisions of the Almaz-Antey Air Defense Concern. As a next step, we are planning to begin manufacturing semiconductor components, including monolithic microwave integrated circuits. We have prepared all the required project documents, as well as the technical feasibility study, and submitted them to senior Almaz-Antey management. Of course, we are not talking about mass production, but we will largely supply our own needs in terms of components for experimental radar equipment developed by our company. The time horizon for this project is 12-18 months. Once this new production facility has been launched, we will have largely achieved the goal of import substitution in terms of components for active phased array radars.
Q: What kind of progress has your company made in upgrading your manufacturing and testing facilities?
I would like to highlight two technologies that are new to us, and that we are actively rolling out at this time. One is low-temperature co-fired ceramics (LTCC). This technology enables us to manufacture electronic components in 3D rather than in two dimensions. In essence, we have launched automatic 3D assembly of semiconductor elements for our hardware. This technology simplifies production and achieves a major reduction in the size of our products. The second important technology we have launched is the production of fiber-optic elements. The active phased arrays we make have internal components that exchange digital and analogue data at tremendous rates. To support those data exchange rates, we need high-quality and jamming-resistant fiber-optic links. And to use that data transport environment, we need components that convert electrical signals into optic and vice versa, as well as components that combine and split those signals. Now we can manufacture the required fiber-optic components independently. That has enabled us significantly to reduce the cost of our products, among other things. In the future we plan to ramp up the production of fiber-optic components, so as to offer them to other companies.
As for our experimental and testing facilities, we have augmented them with some excellent new measuring instruments used for electromagnetic compatibility testing.
Q: Radiofizika develops and manufactures telemetry reception and transmission equipment for spacecraft and rocket launchers. What is the outlook for this division?
A: We remain involved in the launches of Proton rocket carriers. In the future, we will also make telemetry equipment for the new Russian carrier, the Angara. Our partner in this area is GKNPTs Khrunichev. We expect that approximately 15 space launches will rely on our telemetry equipment in 2015. In addition, we will supply our systems to the new Russian space launch center, the Vostochny.
Q: Which programs does Radiofizika regard as the most promising? What are the main technological challenges facing the developers of radar systems (including those related to the development of missile defense systems)?
A: Our future lies with active solid-state phased array technologies. Further improvement in the capability of radar systems will be achieved by increasing the working frequency range of these systems. We are already designing systems that work in the frequency range of up to 10-14 GHz. The objective we have set for ourselves is to move on to the millimeter band, which corresponds to the frequency range of 30 GHz and up. Making radars with such performance characteristics will be very costly, and in order to reduce those costs we need to launch and improve our own automated production of electronic components.
The challenges we are facing are not only technological; they also have to do with organization and the availability of skilled personnel. Modern high-tech production requires a highly skilled workforce. Our specialists are trained at the Radio-physics and Technical Cybernetics Department of the Moscow Institute of Physics and Technology, and the Smart Antenna Systems Design Department of the Moscow Aviation Institute. We have also launched a distance education program, with lectures delivered to our students online by leading specialists. These efforts will help us to accelerate the training of the skilled personnel needed for our programs.
Despite the difficulties currently facing our country, we are optimistic about the future. We are confident that we can secure all the necessary resources (skilled personnel, R&D capability, and finances) to equip the Russian armed forces with the most advanced radar technology.
Interview by Sergey Denisentsev
Centre for Analysis of Strategies and Technologies (CAST)